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Last Updated: Wednesday, 11 July 2007, 23:02 GMT 00:02 UK
Rate rises 'slowing house prices'
For Sale signs
Prices are still going up, but not as fast as before
The rate of house price growth more than halved in June as higher interest rates weakened demand in the property market, a report says.

The Royal Institution of Chartered Surveyors said 10.6% more of its members saw a rise rather than a fall in house prices last month.

This was down from the 22.5% more who had reported an increase in May.

The more closely watched Nationwide and Halifax studies both saw house price inflation rise slightly in June.

'People thinking twice'

The latest Royal Institution of Chartered Surveyors (Rics) monthly survey was its second in succession to see the rate of house price growth slow.

House prices have finally started to cool significantly
Rics spokesman Ian Perry

It said housing demand weakened in most UK regions in June, with Wales, the West Midlands and Scotland being the only exceptions.

The RICS report comes a week after UK interest rates were raised from 5.5% to 5.75%, their fifth increase since last August.

"House prices have finally started to cool significantly for the first time since the recent mini-boom in the housing market got under way in 2006," said Rics spokesman Ian Perry.

"Interest rates hikes have begun to affect the psychology of the market with potential new buyers starting to think twice before buying a home."

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